Ether has risen by more than 5,000 percent since the start of the year. It is the second-largest cryptocurrency, with a market capitalization of more than $ 40 billion.

The rally followed a prediction from billionaire investor Mike Novogratz that ether would hit $ 500 by the end of the year, while bitcoin reaches $ 10,000. Novogratz said that investors are pouring into cryptocurrencies like bitcoin and ether because of the lack of trust in financial institutions following the 2008 crash.

Meanwhile bitcoin cash, a virtual currency that resulted from a split in the original blockchain earlier this year, was also rallying. It soared as much as 19 percent Friday, edging as high as $ 1,789.05. The bitcoin spinoff briefly dethroned ether as the second-largest digital currency earlier this month.